Boeing chief latest scandal scalp

PHIL Condit, long-serving chairman and chief executive of Boeing, has stepped down - the latest boardroom casualty of scandals surrounding the aircraft maker as it struggles to rebuild its reputation with clients, investors and the US government.

The man who would have been Condit's most likely successor, Mike Sears, was forced to leave last week after an internal investigation found he had broken company rules in hiring a senior US Air Force executive.

Former chief operating officer Harry Stonecipher, who retired as an executive last year but has remained on the board, replaces Condit as chief executive.

Stonecipher was head of aircraft maker McDonnell Douglas before it merged with Boeing in 1997. Lewis Platt, a former head of Hewlett-Packard, becomes non-executive chairman.

'I offered my resignation as a way to put the distractions and controversies of the past year behind us,' said Condit, 62. He became president in 1992 and has been chief executive since 1996, becoming chairman the following year.

His departure comes days before the British Government is due to decide on whether a consortium led by Boeing or one led by Airbus will get a valuable order to supply air tankers to the RAF.

Although the company said Condit's departure was not the result of pressure from the US government, the 'distractions' have caused increasing concern in the Defence Department, Boeing's single biggest customer, and have crept closer to the boardroom in recent weeks.

The company found last week that Sears had broken its rules by hiring Darleen Druyun who, in her US Air Force job, had handled the controversial contract for Boeing to supply the government with new air tankers.

The Pentagon is conducting its own investigation into her involvement with Boeing. Defence Secretary Donald Rumsfeldhas asked for a review of the terms of the contract.

Earlier this year the company was suspended from launching any further US government satellites after it was found to have stolen thousands of documents from rival Raytheon.

Boeing said there was no suggestion Condit was involved in any wrongdoing and the change of leadership did not mean a change in business strategy.